TSMC Plunges to Daily Limit Amid AI Shock, Asian Stock Markets Plummet

Asian stock markets are plunging across the board, weighed down by the fallout from the sell-off in artificial intelligence (AI) related stocks on Wall Street overnight.

Japan's technology-heavy Nikkei 225 index plummeted 7% right after the opening, but later pared its losses to trade down 6.0% at 57,438.00 as of 2 p.m.

The broader TOPIX index also fell 6.2%.

Bloomberg reported that the Nikkei is on track to record its biggest daily percentage drop since April of last year.

SoftBank Group and Kioxia plunged 15.8% and 15.3%, respectively, right after the market opened, before narrowing their losses to trade down 10.6% and 10.0%.

Taiwan's Taiex index was trading 3.8% lower at 39,996.07.

Right after the open, it briefly plummeted 3,737.67 points (9.0%), marking the largest intraday point drop on record.

TSMC, which accounts for more than 40% of the market capitalization, briefly hit its 10% daily lower limit at 2,020 New Taiwan dollars before trimming losses to trade 4.2% lower at 2,145 New Taiwan dollars.

South Korea's KOSPI also plummeted up to 8.8% during the session, triggering a circuit breaker, and was down 5.1% at 5,109.73.

In contrast, Chinese stock markets saw relatively modest declines.

Hong Kong's Hang Seng Index fell 1.3%, the Shanghai Composite Index dropped 1.3%, and the sci-tech innovation board STAR 50 Index retreated 2.5%.

Analysts attribute the deepened losses to a combination of leverage and forced liquidation, compounded by growing concerns over tighter AI regulations and a slowdown in data center construction following the Democratic landslide in the U.S. midterm elections.

Charu Chanana, chief investment strategist at investment bank Saxo, said, "There is definitely a panic element to the selling, and positioning is making the correction much more violent."

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.